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International tax: “Pillars” of strength or ruins in the making?


The taxation of multinational corporations is undergoing a paradigm shift in Australia and around the world. Taxing multinationals appears to be a win–win for governments: it satisfies voter concern that multinationals aren’t paying their “fair share”, it isn’t as politically fraught as increasing the taxes (directly) paid by said voters, and it raises much-needed revenue. The main risk is capital flight, but this is minimised where countries act together. To this end, in addition to Australia’s recent unilateral and multilateral measures (the multinational anti-avoidance law and diverted profits tax, and the anti-hybrid rules, the multilateral instrument and country-by-country reporting, respectively), Australia and the 134 other countries in the Inclusive Framework of the Organisation for Economic Cooperation and Development are currently considering an ambitious plan to harmonise and increase the taxation of multinationals — the “two pillars” plan. This article examines the plan and makes predictions about its future.

Author profile

Chloe Burnett ATI
Chloe Burnett is a Barrister at the New South Wales Bar, specialising in tax controversy. She has appeared in a number of high profile tax cases including Chevron, the Part IVA cases News Australia Holdings, British American Tobacco and Citigroup and the buy-back cases Consolidated Media and Cable & Wireless. She is currently advising in relation to a number of BEPS audits. Chloe has been an Adjunct Lecturer at the Sydney University Law School since 2006. - Current at 04 November 2016
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